Construction, Clustering and Co-Working
There is no denying that the wave of urban migration that started in 2011 is still in full force. This makes it an exciting and innovative time in downtown Boston. At last count, more than 5.0 MSF (million square feet) in Boston has been leased by tenants migrating from Cambridge, the Suburbs and out-of-state.
This demand, particularly in the Seaport, has lead to over 5.1 MSF added to inventory between 2013 and 2019.
Tech Makes Headlines; Legal and Financial Services Still Solid
Year of the Big Deal
2017 was the year of the big deal in downtown Boston. PTC, Alexion, Rapid7, Boston Consulting Group, Digitas and WeWork all signed leases over 100,000 SF this year in buildings under construction.
Over the next 24 months, they will occupy a collective 1.1 MSF. Other leases over 100,000 SF include Mintz Levin, Santander and Citizens Bank renewals in the Financial District (205,000 SF, 157,000 SF and 100,000 SF respectively) and Holland Knight’s renewal in Back Bay (105,000 SF). All in, we are tracking 12 leases over 100,000 SF signed in 2017.
Clustering Effect Still Strong
Of the 55 new tech leases executed this year (totaling nearly 1.0 MSF), three clusters emerged in Boston – the Seaport, the Financial District and Government Center/North Station.
While the Seaport and the Financial District aren’t news, the rise of Government Center/North Station is notably recent. Rapid7’s 150,000 square-foot commitment to the Hub on Causeway was the biggest deal, but a number of leases were also executed on Portland, Canal and Causeway Streets – including WeWork’s 56,000 square-foot commitment to 200 Portland Street.
Downtown Boston: Tenant Migration Last 5 Years